Your Voices: Obama's Speech Just Miles From Home Of HuffPost Reader Facing Foreclosure

With 10,000 Americans going into foreclosure everyday, the housing crisis has produced millions of heartbreaking stories across the country. Earlier this week, Arianna asked readers to share how home foreclosures have affected them or their loved ones. We've received many heartfelt responses.

We'll be publishing your stories every weekday as the crisis continues, showcasing one person's voice to represent the 10,000 who will be foreclosed on that day. Have a story on how a home foreclosure has affected you, your family or your friends? Send it to us at [e-mail], and sign up here to receive updates on the feature as it progresses.

Our first story comes from Connie in Queen Creek, Arizona, only twenty miles from the school where President Obama today announced his $75 billion plan to provide relief to homeowners facing foreclosure:

I always thought of home ownership as more than just a roof over our heads. It was a way to provide for your family, earn equity, and could NEVER be a bad investment. That has all changed. My husband's job brought us to Arizona in June, 2005 from Colorado, where the housing market wasn't as booming as it was here. We had to sell our house in Colorado, move everything into storage and move in with family. See, the housing market was so hot then, that no one was accepting contingency offers. In fact, people were getting into bidding wars. It didn't take us long to figure out that a home listed for $200,000.00 could easily be sold for $300,000.00. Homes would be on the market, not days, but hours. So...imagine our surprise when we found one that had been on the market for 11 days. It had everything we needed: 3 bedrooms and a den and in a good school district. It wasn't fancy...only 1700 square feet, but it fit our needs. We snatched it up for $250,000.00. We were moved in within 3 weeks of placing an offer.

Six months later, our home appraised for $312,000.00. I couldn't believe it. My husband thought, "why not refinance out of our interest only loan and pay off some bills." So we did. We refinanced for $280,000.00...but our interest rate was unbelievable...9 1/4 %! Our payments were $2550.00 a month. There was a two year prepayment penalty on our loan, but we assumed (incorrectly) that the worst thing that could happen would be for the market to plateau in 2 years...we never imagined it would bottom out. It did. We are unable to refinance our mortgage because the current value of this house is $145,000.00. We have been trying since May, 2008 to modify our loan to no avail. The mortgage company would rather we foreclose than work with us. See, I work for a school and am not paid over the summer. My husband's commissions dropped significantly in 2008 and we found ourselves making ends meet with credit cards. In October 2008, we made the decision to play hard ball and stop paying our mortgage payments. The bank refused to talk to us unless we were 106 days behind. When they did, they explained it's better to pay the mortgage than the credit card bills. Ordinarily, I would agree, except when your house is worth 1/2 of what you owe on it.

We saw a HUD housing counselor, twice. Needless to say, the mortgage company has refused HUD's recommendations twice. They have turned us down for hardship three times. Recently, upon a referral from our mortgage company, my husband met with ACORN [Association of Community Organizations for Reform Now], in January. Their recommendation was to lower our interest rate. While we're really looking for a principle write down, we'd take a lower interest rate if it could make our home more affordable. The unfortunate thing is, the bank is not approving this course of action either. Additionally, weeks went by without a reply from Acorn after numerous attempts to email them as their phone number had been disconnected. I have to tell you....that was frustrating! Aren't they supposed to be our advocates?

Our mortgage company is now considering offering us a Deed in Lieu of foreclosure settlement instead of straight foreclosure. I would still venture to guess it would've been cheaper for everyone if they would have worked with us instead of against us. This has been a nightmare. I kept thinking that surely we'd qualify for the FHA loan (which we do, but Beneficial or HSBC won't accept it). How many more hoops do we need to jump through? This has been a painful lesson. One, purchasing a house is not always a good investment and two, never make a loan that has a prepayment penalty...ever.

We're looking at an auction date of May 6th...if the bank doesn't accept a deed in lieu of foreclosure. I don't think any plan DC can put together will help us. I can only tell you that people here need principle write-downs. Temporary hardship modifications and interest rate reductions will not help.

We feel absolutely lousy about this. Not only because we're losing our home, but also because we have great neighbors who will surely be affected by another foreclosure in our subdivision. I hope something can be done so others can avoid going through what we've gone through.

Connie is not alone. In 2008, 2.3 million Americans faced foreclosure proceedings, and Obama believes that 9 million families could face foreclosure in the near future. Share a story of how the housing crisis has affected you by emailing [e-mail]. And sing up here to receive updates when we publish new stories.

For more testimonials from people facing foreclosure, take a look at Brave New Foundation's new site, Fighting For Our Homes. Or watch their latest informational video, featuring interviews with Ohio Rep. Marcy Kaptur and economist Dean Baker.

Find out more about Dispatches from the Displaced, HuffPost's Eyes&Ears series of reader-submitted foreclosure stories.

 

 

Comments

[LarryA]

06:17 PM on 02/26/2009

Monica,

I am sure you do a lot of good for the community in your position at ACORN, but with all the people who are in trouble in this country, and in your state, why would ACORN be bailing out irresponsible homeowners?

There are so many responsible people out there who need your help, that you will never be able to help all of them, no matter how hard you try. So you should concentrate your efforts there. They deserve it.

Thank you

[MonicaPhoenix]

03:36 PM on 02/26/2009

Connie,

I'm so sorry that you and your family are finding yourselves in such a difficult situation. Your interest rate is clearly too high and a loan modification is just what you need. How frustrating (but not uncommon) that your financial institution has been reluctant to work with you fairly.

I am the director of Arizona ACORN, headquartered in Phoenix. Our office is very much open, with working phones, that have been on continuously since long before January. I apologize that you've had a hard time communicating with us; I'm not sure where the disconnect happened. However, we are most definitely dedicated to working with you, and other homeowners, who need assistance to renegotiate the terms of their home loans.

Please contact us or our sister organization, ACORN Housing, at one of the following numbers:

ACORN -- 602-254-5299
ACORN Housing -- 602-253-1111

Or, come by our office, at 1018 W. Roosevelt, Phoenix, AZ, 85007 (at the corner of Roosevelt and 11th Ave.).

To contact me directly, please email me at [e-mail].

Again, you are not alone in your financial challenges. Please contact us today!

Thank you,
Monica Sandschafer
State Director
Arizona ACORN

[LarryA]

08:29 PM on 02/23/2009

I have to say to the editors at Huffington Post - why would you post this as a sob story on the mortgage meltdown?

I feel horrible for people losing their homes due to unemployment or disability or major medical bills, but I'm sorry, this person does not qualify to take MY taxpayer dollars to finance their irresponsible mistakes.

They took out gimmicky loans, were ignorant enough to think that an investment (i.e. her home) could NOT go down in value. Who told them that investments are guaranteed? If that is the case where is the bailout of taxpayer dollars to all of us who have taken a major hit in our other investments - our 401(k)s?

Then they opened up the "roof-over-their-heads ATM", refinanced to a worse deal, and now want a PRINCIPLE WRITE DOWN?

Who would borrow money and then dare say they don't feel like paying it all back just because the home ATM stopped printing money?

Huffington Post, I want to hear the stories of the people in the cases of hardship. But when you publish stories of irresponsibility, you are undermining the legitimate problems that Americans are having.

I urge you to think more carefully about the stories of "hardship" that you publish in the future.

Thank you.

[Heidfeld]

04:34 AM on 02/23/2009

This story makes me crazy... and it makes me crazy because I actually feel bad for these people. And I know I shouldn't.

Two years ago I was in the market for a house, and I couldn't believe the prices I was seeing. Needless to say, I couldn't afford what I wanted, and so I didn't buy what/where I wanted and settled for less.

At the time, I knew I was competing with people who should not have been able to offer so much more than what I could. I suspected that many of them were willing to spend way more than they could afford. And a lot of them (like the story above) are the ones that ended up in the houses, while people like me walked away. And guess what? NOBODY felt bad for the people like me. The people that settled for less because they knew they couldn't afford more.

While people were living it up in houses they shuldn't/couldn't own, I doubt they were feeling any sympathy for those like me. But I always though, "their dicision will catch up with them."

Well now it has happened. And it has dragged the whole economy down in the process... and I know I shouldn't feel bad for them, but I still do. I guess that is the difference between some people in this world.

[julescator]

10:39 PM on 02/20/2009

These stories are sad. Obama's plan will NOT help people who ARE currently in foreclosure or who have missed mortgage payments. His plan is to PREVENT foreclosure for people who are currently paying and current on their mortgage but are facing a rate increase shortly and they won't be able to afford the new rate. It is not for any of the people in these three scenarios!

[Delphine]

06:57 PM on 02/20/2009

I do feel bad about people losing their homes. And I believe the mortgage crisis is real and there are sharks and vultures out there ready to take advantage of people who want to buy homes.

But . . .

I bought my house a year ago. It was a foreclosure. I got to see the sales history of the house going back a few years. The man that owned it got married. He had a loan for around $250,000. When he added his wife's name to the deed they refinanced and took out $50,000 in equity (they did not spend it on the house! It had the original 1937 kitchen, in ruins, when I bought it). Then they got a divorce and the man bought out his wife by refinancing the house at about $200k more (height of the market). Then he moved out and rented the house out - but apparently he wasn't making his payments because the bank foreclosed and threw the renters out. The house sat vacant for over a year, until I bought it for $140k less than the last mortgage.

I was able to buy at a fire sale price, so if I hold onto it long enough it should actually one day be worth something. But it's mine.

The point is that the owners took advantage of a rising market (as we all would) and then stuff fell - and the lesson is don't max out loans against the equity in your house

[Kimberly McCabe]

06:48 PM on 02/20/2009

I have read many comments that stick it to the homeowners, I feel your pain. BUT, I think that some of the responsibility lies with the financial system, the banks and the regulations. Many of the people who were offering the loans, selling the loans, prospecting for clients - were just trying to make their commission, keep shareholders happpy and rise through the ranks--they were not advocating for the customer. In fact, many were preying on the naivety of the customers. Many people think (thought) that when financial institutions give you a mortgage or 2nd mortgate, they are offering what you CAN afford. The average public learns about this system, how? Through the experience. When do you learn this in high school or university. Perhaps you have responsible parents who educate you - but what about the ones who put their faith in the professionals? Lots of people made massive errors in judgement. Lots of people made plenty of commission while saying ANYTHING to get someone to sign the papers. Sure I feel bad for those that are in the mess, I don't like that my tax dollars are bailing people out. However, I do hope that the country wakes up and realizes it is a democracy. When you saw people around you buying more house than they could afford...did you call anyone about it? Did you take any steps to stop it? Or did you just say, "Not in my backyard. Not my problem." Lesson learned.

[mumto2bz]

09:45 PM on 02/19/2009

If they were building equity, why were they cashing out? At an INSANE interest rate. For a house that was "only" 1700 sq feet. Bigger than ours. But then, we bought what we could afford and nothing more. And we don't run up bills and use our equity to pay them.

It's DISGUSTING that those of us (owners AND renters) who chose to be responsible (by buying what we could afford or not buying at all) are expected to bail out those who refuse to live within their means.

The bank SHOULDN'T work with these people. They are not reliable.

[Zyzzygowski]

08:13 PM on 02/19/2009

OK, you decided to use your house as an ATM. What did you do with the money?

The reality is, nothing has changed except that your husband's income has dropped. The value of your house has nothing to do with your situation, . . . unless you decide to sell. DON'T SELL. All you need is more income. Get a second and third job if necessary.

Next time do not use your house as an ATM.

[dnpvd51]

05:38 PM on 02/19/2009

I rent and people that cannot afford the house they bought can rent also.

It makes me sick that Obama is bailing out homeowners. This raises the price of housing and the cost to rent.

I am not poor, but poor people are not homeowners. Giving away government money to homeowners really screws over the poor.

[sueinmn]

09:15 PM on 02/19/2009

Well dont be too mad as your not alone. Im a 100% Obama supporter and I will see NO relief either. Im laod off and probably will be for quite some time. Contrustion Electrican. Dont think construction will put us all back to work real soon. My hubby is still employed and we still make too much ecen with my unemployment to qualify for help! 31% of our uncome is more than ouur present pymt. Its stressful as O know my UI will run out before Im back to my career and their simply will not be enough jobs to go around as far as acepting a lesser type employment. Unless the bread earner of the family loses their job, you probably will not see any help. If both people lose their jobs, they have no meaning full way of payback so will this bail out help them? Who will it help and under what cirmumstances. I fear this is a plan that few will benefit. I'd much rather seen across the board help to anyone laid off to have a furlogh of payments for a couple years or a governemtn write down on the interest. Im willing to wait for home values to return, I just want to be able to remain IN MY HOME!

[jamie461]

12:29 PM on 02/19/2009

That's a sad story, but there are MULTIPLE red flags -- bad decisions by Connie and her husband. If you feel you NEED to buy a home with an interest-only mortgage, you are buying more home than you can afford. If you can only refinance that mortgage at a rate of 9 1/4%, at a time when a good rate was in the sixes, you have bad credit, and have no business taking on the additional debt. This is a couple who over-extended themselves. Period.

This is how we got into this problem, for the most part. Yes, lending standards were lax. But homebuyers were ALSO "greedy," wanting more house than they could afford. In some cases, they really shouldn't be homeowners at all -- especially if they have no money to put down. If you cannot come up with a 20% down payment (which is the way it used to be, before easy credit), you should not be able to get a loan. FHA has always had lower down payment requirements than other programs, but once you get past buying that first home, you should NEVER -- repeat, NEVER -- buy another home without AT LEAST 20% to put down.

BE SMART, PEOPLE!!! Take personal responsibility for your mistakes!!!

[speedingpullet]

02:03 PM on 02/19/2009

Maybe an equitable way of dealing with this problem is to allow underwater owners to rent their houses?

Cities, Counties buy the mortgages from the lenders and rent the houses. People could then stay in their homes and be charged the local rent rates to live there. Once they've saved up a donwpayment, and can afford a loan at 3 x income, they could 're-buy' their old houses back.

Many cities also have a lot of derelict foreclosed houses, that could be bought and fixed up and rented to people who have already lost their houses, or simply want to downsize and rent for a while.

It would give local govt a steady income stream, and help with the budgets of cities etc.

Yes, it would mean opening new departments of housing in local govt, and would also need a paradigm shift in thinking on the part of the old 'owners'.
But at a time when so many people are full of fear about thier future - they at least won't have to up sticks and find somewhere else to live at a time when they can least afford it.

I dunno, maybe the idea smacks too much of socialism for some, and there will be homeowners who would rather lose the house than rent it back.

But I'd much rather TARP money was allocated to local govt, to fix local problems, than throw it at the banks in the hope they might, just might, do the right thing.

[ANE]

12:22 PM on 02/19/2009

I agree that the mortgage crises does affect everyone and that we need to do something. However, if this is the face of the mortgage crises, then I have many reservations about bailing this family out of some very questionable assumptions and decisions such as:

"It was a way to provide for your family, earn equity, and could NEVER be a bad investment."

"why not refinance out of our interest only loan and pay off some bills." So we did. We refinanced for $280,000.00...but our interest rate was unbelievable...9 1/4 %! Our payments were $2550.00 a month.
Just because the value of your house is less than what you owe, it is no reason to stop making payments. That makes no sense to me. You agreed to the payments regardless of the "perceived value at the time"
As for bailout assistance, in my opinion they should be able to at least refinance the 280,000. to the current low rates and stay in the house they bought. You can't just walk away because you don’t like what your house is worth.

I am all for assisting people in hardship situations beyond their control-death of family member, medical bills, proven deceptive loan practices, etc. These families have a legitimate need.

[kingmiller]

12:15 PM on 02/19/2009

This is why we elected our man. Stick with Obama kids, and keep your voices loud. He hears us, for the first time in our lives, our President hears us! And if we have his back, if we pressure our Congressional Representatives, then He won't let us fail. God Bless The 44th President of The United States of America!

[SantaFeStars]

12:09 PM on 02/19/2009

Bruce, you appear to be the only person with any logic here. I agree with your comments and wish Connie the best. In my opinion, it boils down to nothing more than GREED from the lenders.

[BruceHNV]

12:56 PM on 02/19/2009

To be fair, borrowers are greedy, too. But a properly regulated system prevents borrower and lender greed from bringing the house down.

Those who want to put it all on the borrower just need someone to feel superior to.

[IowaGirl]

09:47 AM on 02/21/2009

I agree, such superiority and bitter begrudgement. Would those feeling superior and hateful prefer to see these people and their belongings out on the curb? Would that be enough to feed their hunger to run them into the ground and make them "pay" for their bad decisions? Do their children deserve this?

I think the mortgage loan officers and realtors have much more responsibility for this mess than anyone. They were making huge commissions, all of them, and were completely complicit in fooling people into thinking they could live in their own, overpriced (because we were in a massive bubble) homes. They are barely more than criminals, and would probably go out and do the same thing today if they could because that is fundamentally who they are. We need regulations to protect us from greedy and unethical business people, and yes, from our own human weakness and greed.

[Ianta Summers]

11:44 AM on 02/19/2009

1) keep paying your mortgage
2) Talk to the bank to lower the interest rate
3) keep your home until the market turns around.

If people keep foreclosing, it will never turn around. You and your husband have jobs and can continue to be persistent. Dont give up. Hang on until this economy turns around. Get a second job is you have to but dont let it go.